Small businesses are responsible for roughly two-thirds of total job creation in most countries, according to research published by the Kauffman Foundation. Most small business owners start on their own but eventually get to a point where they must hire employees to help out with tasks that they don’t have time, energy, or expertise to perform properly. However, while bringing on an employee is usually a step in the right direction, it can easily end up being a bad decision that could have catastrophic effects on your business.

A hiring mismatch can lead to high employee turnover, inefficiency at the workplace, crime, absenteeism, among other things that can slow down your growth. When hiring your first employee, you must ensure that the process is smooth, thorough, and fully geared towards finding the best employee to help you take your business to the next level.

Due diligence is key 

Before hiring anyone, you must ensure that he is someone you can trust not only to perform the job you are hiring him for properly but also to act in the best interest of the business at all times. While a resume can tell you a lot of details about someone, it usually highlights the best things that the employee wants you to know about them and leaves out the things they think would make them look bad.

This is why you must perform thorough background checks to confirm prior employment claims and find out about any criminal or incarceration records, driving records, drug test results, credit history, and other key details that you’re allowed to get. Keep in mind that it is illegal to ask about the employee’s age, sexual orientation, race, and religion. You may also be required to ask for the employee’s consent when checking personal records such as education and medical records.

Meet the legal requirements 

When hiring an employee, you must understand that it comes with a lot of legal and ethical obligations that you must pay close attention to. You can start by choosing the employee’s classification; are you hiring a part-time, full-time, or temporary employee? This, in turn, will determine the minimum wages you’re allowed to pay him as well as your tax obligations. Another thing you’ll need to find out is the types of insurance coverage you’ll need to protect your new employee as well as the business.

One type of insurance that you must have when hiring a full-time employee is workers’ compensation insurance. If your new employee has a job-related injury or illness, workers’ compensation from Cerity Insurance will cover the cost of treatment as well as any lost wages. Other types of coverage that you can consider buying after hiring include health insurance, employment practices liability insurance, unemployment insurance, and disability insurance.

Train your employee

Before even allowing your new employee to sit on his desk for the first time, it’s vital to take him through onboarding training. A lot of employers make the mistake of assuming that the employee knows what he’s supposed to be doing, which is not the case most of the time. Even if the employee has the technical expertise required to do the job, he still needs some training to learn about the business’s policies and values. This prevents misunderstandings and frustrations arising when you start working together.

One of the best things you can do to speed up the growth of your business is hiring your first employee. While the hiring process can be costly and complicated, the reward will be an increase in productivity and profit, making it totally worth the trouble.

By Eddy

Eddy is the editorial columnist in Business Fundas, and oversees partner relationships. He posts articles of partners on various topics related to strategy, marketing, supply chain, technology management, social media, e-business, finance, economics and operations management. The articles posted are copyrighted under a Creative Commons unported license 4.0. To contact him, please direct your emails to editor.webposts@gmail.com.